Eco-efficiency methodology

By Emma Ringström & Johan Widheden

An EEA assesses the ecological impact and financial structure of competing products, processes or services delivering the same customer benefit, and identifies the best alternative. It includes all steps along the life cycle. The general procedure for carrying out EEA is presented in figure 1. The eco-efficiency methodology is based on a combination of a Life Cycle Assessment (LCA) according to ISO 14040+14044 and an assessment of the Product System Value. ISO standards on LCA methodology have been prepared for harmonisation and credibility reasons. The grey shaded steps in figure 1 can be found in the LCA standards.

The LCA can also be complemented with an analysis of other aspects such as the toxicity potential and risk potential of the alternatives.


Figure 1. General procedures for eco-efficiency analysis.

Definition of Goal and Scope

The goal definition states the purpose of the study and the intended use of the results. The scope definition includes a description of the function and product to be studied, and a functional unit which is a measure of the systems performance and function which satisfies a need. Also included in the scope definition is a definition of the environmental and technical time perspective of the study, and of geographical and technical system boundaries. This defines which processes to include in the EEA.

Economy: Produc Value Assessment

The focus of life-cycle costing is adapted according to the goal and scope of the study. The LCC is actor-specific, i.e. all costs for a certain actor that are associated with a given alternative over the whole period of ownership or stewardship are taken into account. The actor to focus the LCC around is given by the goal and scope definition. Often the actor is the purchaser of a product and the purpose of the LCC result is to communicate how future costs of the product will affect the economy of the purchaser. External costs are not covered by the LCC since by definition external costs are borne by society, and reflect environmental aspects of the system under study [1]. These aspects are covered by the LCA steps.

Ecology: Life Cycle Inventory (LCI)

The life cycle inventory step involves quantification of inflows and outflows of material and energy over the defined system boundaries of the lifecycle. It includes flows related to raw material extraction, processing of raw materials, manufacturing, use, maintenance, recycling/reuse, waste management and transportation (fig 2). Each process requires material and/or energy inflow and produces different kinds of emissions and waste. The LCI results in a long list of different environmental interventions.


Figure 2. A product lifecycle


Ecology: Life Cycle Impact Assessment (LCIA)

The vast amount of data produced by the LCI, and the complexity of the cause and effect of different environmental interventions, make it hard to identify the data that are important from an environmental point of view. For interpretation and communication purposes, methods have been designed to aggregate the LCI data to fewer variables representing either different environmental impact categories (characterization) or the total environmental load of the system (weighting). In this way the environmental hot spots of the life cycle can more readily be identified. The LCIA encompasses three parts; classification, characterization and weighting (fig 3).

In the classification phase inventory data is sorted into environmental impact categories. The classification is based on scientific cause-effect relations, and hence one substance can be assigned to more than one environmental impact category. In the characterization process the inventory data is multiplied with a characterization factor which is specific for each data and environmental impact category. In this way, for each category, the potential environmental impact of all substances in the category is summed up, and represented by one index.


Figure 3. Phases included in Life Cycle Impact Assessment – the stepwise aggregation of information in LCA. The inventory list is usually considerably more extensive, and more characterisation/impact categories are normally included in the EEA.

In a further weighting process the impact category results are aggregated into a single indication or statement of the total strain put on the environment. In the ISO standards the weighting is an optional step of the LCA and no specific weighting methodology is recommended. However, weighting is often a necessary step to simplify communication and decision making and is therefore widely used within industry. When performing an EEA the need for weighting is high, since otherwise each of the various environmental impacts would have to be compared with the cost side individually. Weighting facilitates effective communication and interpretation of the results and provides a better overview of a complex system.

Integrated Assessment and Evaluation

Eco-efficiency may also include a weighting of the environmental impact and costs resulting in the eco-efficiency performance of the alternatives.

This Eco-efficiency weighting can be done in different ways:

       Eco-Efficiency ratio (E/E)

Commonly calculated as: Product or service value/ Environmental influence = Eco-Efficiency ((Brattebø 2005)Ch.12 p 23). We can see in the table below that option A, which is better for the environment (influence is lower), is less Eco-Efficient because the value created is only 1. Option B is more efficient because the value created per unit of environmental impact is higher. The main principle behind this efficiency is that we should create the most value out of the impact we are making on the environment.

Option Product or service value Environmental influence E/E score
A 1 2 0,5
B 3 4 0,75

Table 1. Example Eco-Efficiency E/E calculations

       Eco-Efficiency sum (E+E)

It is calculated like this: Give a weight to the environment and the value. In this case we value them equally thus: 1 & 1.  Then it would look like this:

Option Product or service value Environmental influence Total sum (E+E)
A 1 2 -1   (-2*1 + 1*1)
B 3 4 -1    (3*1 -4*1)

Table 2. Example Eco-Efficiency E + E calculations

Now the eco-efficiency of the alternatives are equal. We still have the same construct, but expressed in a different way: we mean that economy and environment are equally important and for every unit of value we accept one unit of environmental influence. Thus making both alternatives equally bad since they have one more unit of environmental influence then is compensated by the unit of value.

4.6      Interpretation

The purpose of the interpretation phase is to analyze the results of the study, evaluate and explain its limitations and generate conclusions and recommendations. The robustness of the results can be assessed with a sensitivity analysis of the effects that chosen methods and data have on the result of the study.